Australia and Papua New Guinea build on long-term trade relationships

Adrian Weeks, Austrade’s Senior Trade Commissioner in Papua New Guinea, shares his insights on doing business in the country.

History, personal relationships, government support and market opportunity are all connecting Australian business to Papua New Guinea.

Data from the Australian Bureau of Statistics indicates more than 4,000 Australian companies export to Papua New Guinea. It is the largest economy and island state in the Pacific. It is also the most populated Pacific Island with an estimated 10 million people.

Australia has a strong connection to this great country. Due to our strategic location and deep supply chains, Australian companies have long supplied products and services to Papua New Guinea. We are well regarded for our quality products, high standards, good governance and willingness to deliver positive social impact.

I am optimistic about the future of Papua New Guinea. Ten years of growth is about to begin, underpinned by a pipeline of projects valued at around US$50 billion. The people of Papua New Guinea are resourceful and resilient in the face of challenges, and are positive about the future. 

In this article, I share some insights from Australian companies that are successfully exporting to Papua New Guinea.

Work with local partners to understand the market

If you are working in Papua New Guinea for the first time, consider working with an established business that understands the market and complements your product and business values. 

The local partner can help you understand about how business works and what issues will impact your product or service. 

The approach to business can be different when compared to Australia. These differences stem from the different structures of our economies. For example, transport is regulated and frequent in Australia but is often less regulated in Papua New Guinea. Electronic payments are the norm in Australia but are not in Papua New Guinea.

Invest in customer relationships

Australian businesses have consistently mentioned that business in Papua New Guinea is all about relationships. To be successful, you must engage with the market.  

Regular market visits and attendance at trade conferences provide a foundation for building networks and developing relationships. These forums are valuable for business introductions and gaining information.  

Customers across Papua New Guinea value people-to-people relationships. This is the Melanesian way of engagement. Face-to-face meetings will build trust and mutual understanding, confirming your commitment to the market and the business.

Be patient and take your time to invest in building relationships, speaking about the opportunity, and learning about each other’s approach to business.

Make a long-term commitment

To be successful in Papua New Guinea, be prepared for a long-term commitment. The market is not transactional, so long lead times are necessary. 

Listen to your customers about the suitability of your product or service. Work with them to change or alter the product to meet their needs. Avoid short-term financial targets.

Give back to the community

Successful businesses say it is critical to gain a level of acceptance from local communities and government authorities. Supporting the local community in health, education or sports are some ways of building your social licence.

Australia and Papua New Guinea have strong connections and a long trade relationship.

Building stronger business and government relationships

The Australia Papua New Guinea Business Council is in its fifth decade of representing Australian business investors and traders in Papua New Guinea. 

The Council is a membership-based, not-for-profit association interested in progressing the Australia-Papua New Guinea bilateral business and economic relationship. Members include major Australian companies with investments and significant trade and services in Papua New Guinea.

The Council partners with the Business Council of Papua New Guinea to organise the Australia-Papua New Guinea Business Exchange. It is the one of several bilateral business events held between Australia and Papua New Guinea. This year’s Business Exchange will be held in Papua New Guinea from 24–27 September. Register by 10 September 2024. 

The Business Exchange brings together up to 400 business and government representatives to discuss economic challenges, understand supply chain issues and explore investment opportunities.

Vaughan Mills, President of the Australia-Papua New Guinea Business Council, says: ‘The Forum creates an engaged environment in which businesses in Australia and Papua New Guinea can meet to discuss opportunities and broaden demand. There is potential for further trade and investment in areas such as agribusiness and the green economy.’

The Council has a long relationship with the Australian Government, particularly Austrade and the Department of Foreign Affairs and Trade. Together with the Business Council of Papua New Guinea, the Council represents business interests at the annual Ministerial Forum, a bilateral meeting led by the foreign ministers of both countries.

In 2025, Papua New Guinea will celebrate 50 years of independence. Susil Nelson, President of the Business Council of PNG, says: ‘Next year’s event will provide an important platform for business. It will recognise how our economic growth will be powered by the private sector, with a forecast of US$50 billion of resource projects.’ 

This article was first published in the Department of Foreign Affairs and Trade’s August 2024 edition of Business Envoy.